As a researcher with years of experience in the crypto market, I find myself intrigued by the current state of Bitcoin price dynamics. The record-breaking inflows into spot Bitcoin ETFs have undeniably shaken up the landscape, yet the price remains stubbornly below the $70,000 mark.
Regardless of last week’s historic achievement for Bitcoin ETFs on exchanges, the price of a single Bitcoin has yet to surpass the $70,000 threshold.
On October 17th, the combined inflows of U.S.-based Bitcoin Exchange-Traded Funds (ETFs) surpassed $20 billion, a feat achieved in only ten months since their launch. In contrast, it took gold ETFs approximately five years to reach the same level of total net flows.
Bitcoin reached almost $69,487, a peak not seen in about three months, on October 21, but later dropped to $68,570 at around 8:25 am UTC as per CryptoMoon’s data.
The slow movement in Bitcoin’s market price could possibly be a result of the time it takes for Exchange-Traded Fund (ETF) investments to affect the immediate Bitcoin cost, as suggested by experts at Bitfinex.
According to the analysts at CryptoMoon, a high demand for execution (asks) in the crypto market indicates that traders may be utilizing Exchange-Traded Fund (ETF) outflows as a means to exit their trades.
“Usually, this means that large ETF inflows have a muted impact for a few days and then the market reverses lower once the aggression from spot market buyers fades. We need sustained spot market interest to push price out of the current range bound price action.”
The increase in investments into Bitcoin ETFs in the U.S. could potentially drive Bitcoin’s price to a record peak. In less than a month since their debut, these ETFs have accounted for approximately 75% of new Bitcoin investment, with the cryptocurrency already surpassing the $50,000 level at that time.
BlackRock ETF tops inflows with $1.17 billion
According to Bitfinex analysts, the introduction of Bitcoin ETFs hasn’t significantly affected the price in the short term. Instead, it typically takes several days for investments to build up and create a noticeable upward trend.
“Despite the significant inflows into Bitcoin ETFs, particularly into the BlackRock and Fidelity funds, the price impact has been muted on several instances on days when net inflows exceeded $500 million worth of BTC.”
Over the last seven days, Lookonchain, a leading firm in on-chain analysis, has pointed out that BlackRock’s iShares Bitcoin Trust ETF amassed approximately $1.17 billion in Bitcoin holdings, according to their October 21st blog post.
Last week’s ETF inflows might have been partially employed in a delta-neutral trading approach, which could explain why the resulting price influence was relatively subdued, according to Bitifnex analysts.
Bitcoin nudges bullish weekly candle close
In positive news for its trajectory, Bitcoin successfully ended the week with a green closure above the notable level of $69,000.
According to well-known cryptocurrency analyst Rekt Capital in a recent post on October 20th, there’s a possibility that Bitcoin could surge and reach the high accumulation zone around $71,000 for the first time since June 2024, as shown in the chart below.
The potential increase in investments for Bitcoin might be strengthened further with additional ETF influxes, fueled by the debut of Bitcoin ETF options in the United States, which received approval from the Securities and Exchange Commission on October 18th.
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2024-10-21 13:53